The first shipment of Russian oil arrived in Karachi, Pakistan, on Sunday, a delivery that was initially expected last month but was delayed due to logistical challenges and severe cyclonic storm (VSCS) Biparjoy.
The Russian oil delivery is a significant milestone marking the first time Pakistan has received discounted Russian crude oil as part of a recent deal between Moscow and Islamabad.
The Russian vessel, named Pure Point, measures 183 meters in length and delivered 45,000 metric tons of oil to berth number 4 at the port. Initially, the vessel was scheduled to reach the Omani port of Duqm on May 27-28. However, technical delays and a long wait at Egypt’s Suez Canal led to the oil tanker only arriving in Oman on June 7, a delay of 10 days.
Remaining Russian Crude to Arrive Later
The second half of the shipment, carrying an additional 50,000 tons of Russian crude, is expected to dock at Port Qasim on June 20. Authorities have reassured us that despite the initial delay, they are dedicated to ensuring the safe and efficient delivery of the remaining oil. The delay will not impact the transportation cost, which has already been agreed upon with the Russians.
Impact of the Russian Oil Delivery
The crude oil from this initial delivery will be processed by Pakistan Refinery Limited (PRL), blending it with oil imported from the United Arab Emirates and Saudi Aramco. PRL has been assigned to report to the government on the oil’s quality, yields, and commercial viability. This report will assist the government in evaluating refining costs, transportation costs, and refinery margins.
Pakistan imports 70% of its crude oil, refined by PRL, National Refinery Limited, Pak Arab Refinery Limited, and Byco Petroleum. The remaining 30% is locally produced and processed by domestic refineries, including Attock Refinery Limited.
The importation of Russian oil represents a strategic decision by Pakistan to diversify its oil sources amid climbing global prices. Russia, a significant producer of crude oil, has offered Pakistan discounted rates on its oil. Payment for the Russian oil will be made in yuan via the Bank of China.
